John Laing Group plc (LON: JLG) announced today its unaudited results for the six months ended 30 June 2019
Highlights: Mixed H1 results – Full year outlook unchanged
· Net asset value (NAV) of £1,599 million or 325p1 per share at 30 June 2019 (31 December 2018 – £1,586 million or 323p) up 0.6% since 31 December 2018 or 3.0% including dividend paid in May 2019
· Portfolio value at 30 June 2019 of £1,535 million up 3.5% on the rebased portfolio value2 at 31 December 2018
· Good operational performance but challenges in renewable energy portfolio, mitigated by value enhancements and strong project delivery:
£66 million of write downs on renewable energy assets in Australia due to industry transmission problems
£55 million of write downs on our European wind assets
£78 million of value enhancements delivered through active management across the portfolio and in all regions
Significant progress on projects including Sydney Light Rail and New Generation Rollingstock in Australia, Denver Eagle P3 and I-77 in the US and IEP Phase 2 in the UK
· Sale of all remaining fund management activities completed
· New investments of £7 million (six months ended 30 June 2018 – £39 million)3. One further investment completed in August, in North America, and another agreed and expected to complete in September, our first investment in Latin America, totalling approximately £137 million
· Healthy pipeline of £2.1 billion of investment opportunities. Solar and wind investments on hold in Europe and Australia pending current issues resolution; investment in US renewable energy assets limited to recycling of capital
· Realisations of £131 million from the sale of three investments (six months ended 30 June 2018 – £242 million from the sale of two investments)
· Profit Before Tax (PBT) of £35 million (six months ended 30 June 2018 – £175 million, which included an exceptional gain on IEP Phase 1 disposal) and Earnings Per Share (EPS) of 7.1p (six months ended 30 June 2018 – 38.8p)4
· Interim dividend of 1.84p per share payable in October 2019 (six months ended 30 June 2018 – 1.80p per share) in line with dividend policy
- NAV per share at 30 June 2019 calculated as NAV of £1,599 million divided by the number of shares in issue at 30 June 2019 of 491.8 million, excluding the shares held in the Employee Benefit Trust (EBT).
- Rebased portfolio value is described in the Portfolio Valuation section.
- Based on new investment commitments secured in the six months ended 30 June 2019; for further details see the Business Review.
- Basic EPS; see note 7 to the Condensed Group Financial Statements.
Olivier Brousse, John Laing’s Chief Executive Officer, commented:
“Our operational performance in the first half was strong, however we have had a number of challenges with our renewable energy assets in Australia and Europe. We delivered value enhancements across the portfolio, but predominantly in renewable energy, which has helped to mitigate the impact of these challenges. In addition, we made good progress on key assets in our PPP portfolio. The Denver Eagle P3 commuter rail project fully opened to the public in April, IEP Phase 2 commenced public train services in May and Sydney Light Rail and New Generation Rollingstock also progressed well in the last six months. Our asset management teams have been instrumental in successfully progressing all of these projects, protecting and enhancing the value of our investments.
We are confident in our ability to continue to generate value from our existing portfolio, to make the most of a secondary market that remains strong and capitalise on the demand for operational infrastructure. At the same time, our investment teams are actively seeking new PPP investments, supported by our strong financial resources and partner relationships. We are particularly pleased in this regard to have agreed in July our first investment in Latin America, with the Ruta del Cacao PPP road project in Colombia. New renewable energy investments have been put on hold in Europe and Australia, and limited to recycling of capital in North America, as we re-assess our approach to risk and return in these markets. Nevertheless, our pipeline remains healthy across our established geographies and in new markets and sectors.
We remain confident in delivering our full year expectations, underpinned by the value inherent in our existing portfolio and further penetration of our targeted markets.”